Catholic Charities of Rockford announced Thursday that the agency will halt its state-funded foster care and adoption services Wednesday — the day civil unions take effect in Illinois.

The decision is the first of what could become a domino effect of Catholic Charities leaving the foster care and adoption business to avoid liability if state law requires them to place children with parents in civil unions — either gay or straight.

In Rockford, the decision could displace about 350 foster children served by Catholic Charities and put 58 employees out of work.

Officials cited a lack of clarity in the Illinois Religious Freedom Protection and Civil Unions Act, which does not specify whether religious child welfare agencies must place children with couples in civil unions.

Without a specific provision protecting religious agencies, church officials said, the agency can't risk losing state contracts or facing lawsuits if it turns away gay couples or others in civil unions.

Benjamin Wolf, an attorney with the American Civil Liberties Union of Illinois who represents juvenile state wards as part of a court-monitored consent decree with DCFS, said the decision was troubling, especially in Rockford where there is a high turnover of child welfare workers and racial and economic tensions.

"Rockford would not be the place I would've chosen to start these transitions," Wolf said. "I am very sorry that they would give a greater priority to their commitment to continue discriminating than the health and welfare of Illinois children."